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Trends in Firm Entry and New Entrepreneurship in Canada

Author

Listed:
  • Shutao Cao
  • Mohanad Salameh
  • Mai Seki
  • Pierre St-Amant

Abstract

Since the early 1980s, the firm entry rate and the rate of new entrepreneurship have trended downward in Canada. This article documents these trends and discusses potential explanations. A shift-share analysis suggests that industrial and demographic structure changes cannot explain these long-term trends, although population aging accounts for part of the decline in new entrepreneurship since around 2000. The article discusses other factors that could contribute to the downward trends: increased industrial concentration, changing labour market conditions, increased college wage premium, higher student debt, and government regulation. Some of these may be important, but more research is needed before firm conclusions can be reached.

Suggested Citation

  • Shutao Cao & Mohanad Salameh & Mai Seki & Pierre St-Amant, 2017. "Trends in Firm Entry and New Entrepreneurship in Canada," Canadian Public Policy, University of Toronto Press, vol. 43(3), pages 202-220, September.
    • Handle: RePEc:cpp:issued:v:43:y:2017:i:3:p:202-220
    DOI: 10.3138/cpp.2017-006
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    Cited by:

    1. Andrew Agopsowicz & Bassirou Gueye & Natalia Kyui & Youngmin Park & Mohanad Salameh & Ben Tomlin, 2017. "April 2017 Annual Reassessment of Potential Output Growth in Canada," Staff Analytical Notes 17-5, Bank of Canada.
    2. Pierre St-Amant & David Tessier, 2018. "Firm Dynamics and Multifactor Productivity: An Empirical Exploration," Staff Working Papers 18-15, Bank of Canada.
    3. Andrew Agopsowicz & Dany Brouillette & Bassirou Gueye & Julien McDonald-Guimond & Jeffrey Mollins & Youngmin Park, 2018. "Potential Output in Canada: 2018 Reassessment," Staff Analytical Notes 2018-10, Bank of Canada.
    4. Shujiang Cao & Shutao Cao, 2025. "Worker Quality, Matching and Productivity Slowdown," Papers 2509.00516, arXiv.org.
    5. Andrew Agopsowicz & Dany Brouillette & Shutao Cao & Natalia Kyui & Pierre St-Amant, 2016. "April 2016 Annual Reassessment of Potential Output in Canada," Staff Analytical Notes 16-4, Bank of Canada.
    6. Röhe, Oke & Stähler, Nikolai, 2020. "Demographics and the Decline in Firm Entry: Lessons from a Life-Cycle Model," VfS Annual Conference 2020 (Virtual Conference): Gender Economics 224603, Verein für Socialpolitik / German Economic Association.

    More about this item

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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